Byte beating dilemma, not selling may die abroad, selling may die at home

ByteDance is facing a dilemma again, and TikTok transactions have added another big variable.

According to the announcement on the website of the Ministry of Commerce of the People’s Republic of China on August 28, the Ministry of Commerce and the Ministry of Science and Technology have adjusted and released the “Catalogue of China’s Export Prohibited and Restricted Technologies” (Ministry of Commerce and Technology Announcement No. 38 of 2020, hereinafter referred to as the “Catalog”).

Part of the adjustment content is generally considered to be related to TikTok transactions: “Add control points under the information processing technology (No. 056101X) item: “…21. Personalized information push service technology based on data analysis”…”. Douyin & TikTok, or expand to today’s headlines and even some other applications by ByteDance, its core competitiveness or core value comes from “Personalized Information Push Service Technology Based on Data Analysis”. It should be said that this provision is for TikTok. Tailoring is not impossible.

Screenshot from the official website of the Ministry of Commerce of China

ByteDance has previously stated that it has prepared the worst plan for shutting down U.S. operations

Prior to this, TikTok formally filed a lawsuit against the US government on August 24th, local time in the US.

Regarding this lawsuit, TikTok’s parent company ByteDance stated that it is rare for companies to appeal to the U.S. government under the International Emergency Economic Rights Act (IEEPA), and there is little chance of success. Intend. ByteDance said that because the shutdown involves more than 1,500 TikTok employees and thousands of partners in the United States, the company is intensively assessing the damage to the legitimate rights and interests of employees, users, and partners after the shutdown, and simultaneously protects them. Pre-plan.

On August 27, it was reported that the sale of TikTok’s business in North America, Australia and New Zealand by ByteDance may be concluded within the next 48 hours. The size of the transaction may be between US$20 billion and US$30 billion, and the final buyer may be Microsoft, Oracle or Wal-Mart.

Immediately afterwards, on August 28, the Ministry of Commerce and the Ministry of Science and Technology adjusted and released the latest version of the “Catalogue of China’s Export Prohibited and Restricted Technologies.”

In the latest edition of “China’s Export Prohibited and Restricted Technology Catalog”, technologies including speech synthesis, artificial intelligence interactive interface, voice evaluation, personalized information push services based on data analysis, drones, quantum cryptography and other technologies are all included in the “restricted” List of Exports.

According to Bloomberg News quoted a person familiar with the matter, according to the new restrictions imposed by the Chinese government on the export of technology in the field of artificial intelligence, the sale of TikTok’s US business by ByteDance will require the approval of the Chinese government.

The Ministry of Commerce’s announcement also mentioned that according to the “Regulations of the People’s Republic of China on the Administration of Technology Import and Export”, all technologies involved in the transfer of technology abroad, whether through trade, investment or other means, must strictly abide by the “Administration of Technology Import and Export of the People’s Republic of China”. According to the Regulations, the export of restricted technologies must apply for a technology export license at the provincial-level commerce authority, and only after obtaining approval can it conduct substantive negotiations and sign a technology export contract.

The above-mentioned people familiar with the matter said that the new regulations are designed to postpone the sale, rather than completely prohibit it. Further approval by Beijing may delay and disrupt any transaction. The person familiar with the matter said that the TikTok transaction may be postponed until after the November U.S. election due to the time required for the Chinese government’s review.

After the new regulations of the Ministry of Commerce and the Ministry of Science and Technology were published on 28, Cui Fan, a professor at the China University of International Business and Economics, said in an interview with Xinhua News Agency that if the technology exporters who have not completed the transaction when the new catalog takes effect, they plan to export the restricted technologies in the adjusted catalog , It is recommended to suspend the negotiation and trade procedures, and fulfill the relevant application procedures.

In response to the new regulations of the Ministry of Commerce & Ministry of Science and Technology, ByteDance issued an announcement on August 30, stating that: The company was concerned about the announcement of the “Regulations and Release of the “China’s Export Prohibited and Restricted Technology Catalogue” on August 28. Announcement, the company will strictly abide by the “Regulations of the People’s Republic of China on the Administration of Technology Import and Export” and the “Catalogue of China’s Export Prohibited and Restricted Technologies”, and will deal with related businesses related to technology export.

Screenshot from ByteDance official account

According to the “New York Times” on the 28th, citing people involved in the deal negotiations, the competition for the acquisition of TikTok’s US business has entered the “final stage”, and two groups of bidders have submitted quotations for this video application. One of them is from Microsoft and Wal-Mart, and the two companies have joined forces; the other bid is from Oracle, which may include an investor alliance.

Chinese netizens: Help you decently

ByteDance’s current predicament can be described as both “spring breeze” and “no people at both ends”. On the one hand, Douyin & TikTok has been loved by users around the world and has achieved great success. It is the first China to achieve “global success”. application. On the other hand, in the current international geopolitical context, TikTok, which has achieved “global success”, has been regarded as a model and received “special treatment” from governments of various countries.

While US President Trump forced ByteDance to sell TikTok’s business, relevant Chinese authorities also introduced the aforementioned export restrictions. At the same time, a large number of Chinese netizens also “indecently” succumbed to Trump’s prostitution to Bytedance (although TikTok has formally sued the Trump administration), claiming that the country is “helping you decently.”

The screenshot is self-knowing about the related problem page

In the face of this public opinion environment, whether ByteDance sells TikTok or not will offend certain groups. This kind of dilemma of “no people at both ends”, I don’t know how long ByteDance will have to face?

In this situation, it seems that Bytedance has already made its “worst plan to shut down TikTok’s US business”, or it will really come true…